A jobs program to support the hiring of unemployed veterans has been slow to take hold with less than 10 percent of the money borrowed for the program reaching employers since 2012.
Gov. Dannel Malloy and the General Assembly created “Step Up for Vets” nearly two
years ago and borrowed $10 million to fund it. The program is modeled after the Subsidized Training and Employment Program, known as Step Up, another Department of Labor program with $20 million in funding split between wage subsidies and manufacturer training.
Malloy announced plans Tuesday to continue the traditional Step Up program with another $10 million in funding. The program has spent $16 million of the original $20 million or 80 percent of its funding.
The funding went to about 2,000 new employees at 500 small businesses who were paid an average wage of $15.72 per hour, according to department.
The program for veterans has helped about 100 unemployed veterans get hired at an average wage of nearly $17 per hour, spending less than $1 million, or 10 percent, of the money allocated.
Last year, the General Assembly expanded eligibility for the program.
“At that time, it was only open to veterans if they were a combat veteran of Operation Enduring Freedom in Afghanistan or military operations in Iraq,” said Nancy Steffens, a spokeswoman for the Labor Department.
Steffens said “many returning veterans from those wars opted to go back to school instead of work,” which led to the program’s expansion.
“Since that time, many more veterans have been eligible for the program,” she said. “It has been much easier for the agency to match employers with veterans that can take part.”
In December the Auditors of Public Accounts raised concerns with operation of the Step Up program. The auditors found recipient businesses that owed back taxes and employees who were not newly-hired, as required by the law.
The department agreed with the audit findings and plans to improve the screening process.
Auditors also found the department imposed an arbitrary $12,000 limit on the subsidies, but the department defended the practice because the limit allows the program to “serve as many eligible employees as possible.”
When the Step Up law initially passed, residents of only 39 towns were eligible for the program.